GBP/USD trends along a short-term descending line

Christina Parthenidou XM

GBPUSD closed with few gains on Monday, remaining inside the Ichimoku cloud and below the descending line drawn from the 9-month high of 1.3380. Both the RSI and the MACD have been making efforts to exit the bearish territory, with the former reversing towards its 50 neutral mark and the latter easing negative momentum to climb above its red signal line. While those attempts provide some optimism, they are not enough yet to support strong positive prospects for the short-term trading.

A strong rally above 1.3150 and the downtrend line could encourage more buying in the market. Moving higher, a close above the January 25 peak of 1.3216 would increase confidence on the upward pattern that started from the 1.2475 bottom that has lost some shine after the sell-off below the 1.3380 top. Should the price pierce the 1.3300 round-level too, then the bulls would have to beat a taller wall between 1.3380 and 1.3460.

On the downside, the 200-day moving average currently at 1.2964 could be the trigger point for a steep decline that may initially pause around 1.2929 (the 50% Fibonacci of the downleg from 1.2393 to 1.3380) before extending towards the 1.2777 low.

Meanwhile in the medium-term picture, GBPUSD remains on the bullish side as long as the market keeps trading above the 1.2959 trough. A decisive step below that mark would violate the upward trend started from the 1.2475 bottom.

In brief, GBPUSD is facing a neutral bias in the short term, while in the medium-term the pair is holding positive above 1.2959.

Author

Christina Parthenidou

Christina joined the XM investment research department in May 2017. She holds a master degree in Economics and Business from the Erasmus University Rotterdam with a specialization in International economics.

EUR/USD weakens as US jobs data trims Fed rate cut bets

The EUR/USD pair trades in negative territory for the third consecutive day near 1.1860 during the early European session on Thursday. Traders will keep an eye on the US weekly Initial Jobless Claims data. On Friday, the attention will shift to the US Consumer Price Index inflation report.

GBP/USD bullish outlook prevails above 1.3600, UK GDP data looms

The GBP/USD pair gains ground near 1.3635, snapping the two-day losing streak during the early European session on Thursday. The preliminary reading of UK Gross Domestic Product for the fourth quarter will be closely watched later on Thursday. The UK economy is estimated to grow 0.2% QoQ in Q4, versus 0.1% in Q1.

Gold remains on the defensive below two-week top; lacks bearish conviction amid mixed cues

Gold sticks to modest intraday losses through the Asian session on Thursday, though it lacks follow-through selling and remains close to a nearly two-week high, touched the previous day. The commodity currently trades above the $5,070 level, down just over 0.20% for the day, amid mixed cues.

UK GDP set to post weak growth as markets rise bets on March rate cut

Markets will be watching closely on Thursday, when the United Kingdom’s Office for National Statistics will release the advance estimate of Q4 Gross Domestic Product. If the data land in line with consensus, the UK economy would have continued to grow at an annualised pace of 1.2%, compared with 1.3% recorded the previous year.

The market trades the path not the past

The payroll number did not just beat. It reset the tone. 130,000 vs. 65,000 expected, with a 35,000 whisper. 79 of 80 economists leaning the wrong way. Unemployment and underemployment are edging lower. For all the statistical fog around birth-death adjustments and seasonal quirks, the core message was unmistakable. The labour market is not cracking.

Sonic Labs’ vertical integration fuels recovery in S token

Sonic, previously Fantom (FTM), is extending its recovery trade at $0.048 at the time of writing, after rebounding by over 12% the previous day. The recovery thesis’ strengths lie in the optimism surrounding Sonic Labs’ Wednesday announcement to shift to a vertically integrated model, aimed at boosting S token utility.